Colombia's Inflation Hits 6.14% Just Days After Central Bank Rate Hike to 12%
Colombia's annual inflation rate reached 6.14% in June, the highest level in roughly two years, just over a week after the central bank raised its benchmark interest rate to 12%. The reading beat every analyst forecast, which had ranged from 6.01% to 6.13%. The mismatch raises fresh questions about whether Banco de la República's tightening cycle is keeping pace with price pressures.
Colombia's annual inflation rate climbed to 6.14% in June, its highest level in about two years, according to figures released this week. The reading came just eight days after the central bank, Banco de la República, raised its benchmark interest rate to 12%.
The result caught economists off guard. Analysts polled ahead of the release had forecast a range of 6.01% to 6.13%, meaning every projection undershot the actual figure. The bank's own forecast had also pointed to a softer number.
The mismatch is likely to intensify debate over whether the current tightening cycle is sufficient to bring prices back toward target, and whether policymakers will need to move again at their next meeting. Analysts said the data complicates the bank's messaging just as it tries to convince markets the worst of the inflation cycle is behind it.
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